write about credit sources in India
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There are two sources of credit in INDIA.
1.Formal sources
2.Informal sources.
Formal sources are loans from banks and cooperatives.
Informal sources are from moneylenders,traders, employers ,relatives,friends etc.
RBI supervises the functioning of formal sources of loans.
There is no organisation which supervises the functioning of informal sources of loans.
Formal sources of loan charge a reasonable rates of interest.
Informal sources charge a very high interest rate.
Formal sources require proper documentation and collateral.
Informal lenders like the moneylenders know the borrowers personally and hence are often willing to give a loan without collateral.
1.Formal sources
2.Informal sources.
Formal sources are loans from banks and cooperatives.
Informal sources are from moneylenders,traders, employers ,relatives,friends etc.
RBI supervises the functioning of formal sources of loans.
There is no organisation which supervises the functioning of informal sources of loans.
Formal sources of loan charge a reasonable rates of interest.
Informal sources charge a very high interest rate.
Formal sources require proper documentation and collateral.
Informal lenders like the moneylenders know the borrowers personally and hence are often willing to give a loan without collateral.
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